What if India seized princely state royal wealth on unification

When India incorporated the princely states a lot of the prince's kept vast personal fortunes.

What would have happened if these fortunes were confiscated or heavily taxed as the princely state joined India.

I'm thinking in particular the Nazim of Hydrabad who was considered the richest person in the world when he passed away (inflation adjusted wealth in excess of $200 billion in today's money) and similar people of that sort.

Would it have made the princely states struggle more to prevent unification or would the additional wealth in state coffers have made much of a difference to the economy of India going forward.

Similarly could Britain have moved against the princely states incorporating them with British India at some stage in the 20th century and attempted to apply taxes to the princes?
 
For such a thing, you would need Nehru to be a lot more like his daughter. I am not really sure if such a thing would be accepted, considering the firestorm Mrs. Gandhi caused when she abolished the privy purse. Princes were also well-respected, and still are if the Padmavati controversy is anything to go by.

Similarly could Britain have moved against the princely states incorporating them with British India at some stage in the 20th century and attempted to apply taxes to the princes?

The princely states provided an important function in Imperial administration . They allowed the British to deflect blame onto the princes. For instance, they blamed India’s constant state of famine on the princes, rather than on themselves. And when Indian soldiers attacked British authorities for sending them to die half a world away in the World Wars for a country they cared little about, the British told them to take it up with their princes.
 
Thanks. I'm willing to admit that I don't know a huge amount amount about the princely states and the wealth of the rulers.

The princely states provided an important function in Imperial administration . They allowed the British to deflect blame onto the princes. For instance, they blamed India’s constant state of famine on the princes, rather than on themselves. And when Indian soldiers attacked British authorities for sending them to die half a world away in the World Wars for a country they cared little about, the British told them to take it up with their princes.
I know the Hydrabad regiment in ww1 had their funding taken over by the Indian Administration and all replacements came from outside the Princely state. I'm not sure how successful any attempts to deflect blame on the princely state would be in this instance.
 
I remember my Great-Uncle trying to explain the Taxation system of the Nizam of Hyderabad. Byzantine doesn't begin to explain its structure.
(It was apparently possible to be taxed 3 times on the same thing.)
 
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